Bill Analysis and Fiscal Impact Statement
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The Florida Senate BILL ANALYSIS AND FISCAL IMPACT STATEMENT (This document is based on the provisions contained in the legislation as of the latest date listed below.) Prepared By: The Professional Staff of the Committee on Regulated Industries BILL: SB 522 INTRODUCER: Senator Diaz SUBJECT: Vacation Rentals DATE: February 15, 2021 REVISED: ANALYST STAFF DIRECTOR REFERENCE ACTION 1. Oxamendi Imhof RI Pre-meeting 2. CM 3. RC I. Summary: SB 522 preempts all regulation of vacation rentals to the state, including the inspection and licensing of vacation rentals. A vacation rental is a unit in a condominium or cooperative, or a single, two, three, or four family house that is rented to guests more than three times a year for periods of less than 30 days or one calendar month, whichever is shorter, or held out as regularly rented to guests. Vacation rentals are licensed by the Division of Hotels and Restaurants (division) within the Department of Business and Professional Regulation (DBPR). Under the bill, a local government may regulate activities that arise when a property is used as a vacation rental, provided the regulation applies uniformly to all residential properties. Under current law, local governments may not prohibit vacation rentals or regulate the duration or frequency of vacation rentals. A local law, ordinance, or regulation adopted on or before June 1, 2011, is exempt from this prohibition, and a local government may maintain this exemption if their future amendment to a grandfathered regulation results in a less restrictive regulation of the prohibition, duration, or frequency of vacation rentals. The bill also preempts the regulation of advertising platforms to the state. An advertising platform is a person who electronically advertises a vacation rental to rent for transient occupancy, maintains a marketplace, and a reservation or payment system. The bill requires the owner or operator of a vacation rental offered for transient occupancy through an advertising platform to include the property’s vacation rental license number and the applicable Florida sales tax registration and tourist development tax account numbers on the vacation rental’s advertisement, and attest that, to the best of their knowledge, those numbers are current, valid, and accurate. The vacation rental property owner or operator must display this tax and licensure information inside the vacation rental property. The bill requires an advertising platform to display the vacation rental license number and the Florida sales tax registration and tourist development tax account numbers of each property that BILL: SB 522 Page 2 advertises on its platform. The advertising platform must verify the validity of the vacation rental’s license number before it publishes the advertisement and must perform ongoing checks every calendar quarter thereafter. To facilitate this verification, the division must maintain vacation rental license information in a readily accessible electronic format. The advertising platform must remove from public view any advertisement or listing that fails to display a valid vacation rental license number. Under the bill, advertising platforms must provide to the division on a quarterly basis information that assists the division with identification and verification of the vacation rental property’s compliance with the bill’s requirements. Advertising platforms are required by the bill to collect and remit any taxes imposed under chs. 212 and 125, F.S., that result from payment for the rental of a vacation rental property on its platform. The bill allows platforms to exclude service fees from the taxable basis. It allows the division to take enforcement action for noncompliance. Additionally, advertising platforms must adopt anti-discrimination policies and inform users of the public lodging discrimination prohibition found in s. 509.092, F.S. The bill provides that its terms do not supersede any current or future declaration or covenant for condominium, cooperative, or homeowners’ associations. The bill takes effect upon becoming law. However, the provisions relating to the regulation of advertising platforms take effect January 1, 2022. II. Present Situation: The Division of Hotels and Restaurants (division) within the Department of Business and Professional Regulation (DBPR) is the state agency charged with enforcing the provisions of ch. 509, F.S., relating to the regulation of public lodging establishments and public food service establishments for the purpose of protecting the public health, safety, and welfare. The term “public lodging establishments” includes transient and nontransient public lodging establishments.1 The principal differences between transient and nontransient public lodging establishments are the number of times that the establishments are rented in a calendar year and the duration of the rentals. A “transient public lodging establishment” is defined in s. 509.013(4)(a)1., F.S., as: any unit, group of units, dwelling, building, or group of buildings within a single complex of buildings which is rented to guests more than three times in a calendar year for periods of less than 30 days or 1 calendar month, whichever is less, or which is advertised or held out to the public as a place regularly rented to guests. A “nontransient public lodging establishment” is defined in s. 509.013(4)(a)2., F.S., as: 1 Section 509.013(4)(a), F.S. BILL: SB 522 Page 3 any unit, group of units, dwelling, building, or group of buildings within a single complex of buildings which is rented to guests for periods of at least 30 days or 1 calendar month, whichever is less, or which is advertised or held out to the public as a place regularly rented to guests for periods of at least 30 days or 1 calendar month. Section 509.013(4)(b), F.S., exempts the following types of establishments from the definition of “public lodging establishment”: 1. Any dormitory or other living or sleeping facility maintained by a public or private school, college, or university for the use of students, faculty, or visitors; 2. Any facility certified or licensed and regulated by the Agency for Health Care Administration or the Department of Children and Families or other similar place regulated under s. 381.0072, F.S.; 3. Any place renting four rental units or less, unless the rental units are advertised or held out to the public to be places that are regularly rented to transients; 4. Any unit or group of units in a condominium, cooperative, or timeshare plan and any individually or collectively owned one-family, two-family, three-family, or four-family dwelling house or dwelling unit that is rented for periods of at least 30 days or one calendar month, whichever is less, and that is not advertised or held out to the public as a place regularly rented for periods of less than one calendar month, provided that no more than four rental units within a single complex of buildings are available for rent; 5. Any migrant labor camp or residential migrant housing permitted by the Department of Health under ss. 381.008-381.00895, F.S.; 6. Any establishment inspected by the Department of Health and regulated by ch. 513 F.S.; 7. Any nonprofit organization that operates a facility providing housing only to patients, patients’ families, and patients’ caregivers and not to the general public; 8. Any apartment building inspected by the United States Department of Housing and Urban Development or other entity acting on the department’s behalf that is designated primarily as housing for persons at least 62 years of age. The division may require the operator of the apartment building to attest in writing that such building meets the criteria provided in this subparagraph. The division may adopt rules to implement this requirement; and 9. Any roominghouse, boardinghouse, or other living or sleeping facility that may not be classified as a hotel, motel, timeshare project, vacation rental, nontransient apartment, bed and breakfast inn, or transient apartment under s. 509.242, F.S. Public lodging establishments are classified as a hotel, motel, vacation rental, nontransient apartment, transient apartment, bed and breakfast inn, or timeshare project.2 A “vacation rental” is defined in s. 509.242(1)(c), F.S., as: any unit or group of units in a condominium, cooperative, or timeshare plan or any individually or collectively owned single-family, two-family, three-family, or four-family house or dwelling unit that is also a transient public lodging establishment but is not a timeshare project. 2 Section 509.242(1), F.S. BILL: SB 522 Page 4 The DBPR licenses vacation rentals as condominiums, dwellings, or timeshare projects.3 The division may issue a vacation rental license for “a single-family house, a townhouse, or a unit or group of units in a duplex, triplex, quadruplex, or other dwelling unit that has four or less units collectively.”4 The division does not license or regulate the rental of individual rooms within a dwelling unit based on the roominghouse and boardinghouse exclusion from the definition of public lodging establishment in s. 509.013(4)(b)9., F.S.5 The 48,226 public lodging establishments licensed by the division are distributed as follows:6 Hotels – 2,191 licenses; Motels – 2,497 licenses; Nontransient apartments – 18,571 licenses; Transient apartments – 942 licenses; Bed and Breakfast Inns – 269 licenses; Vacation rental condominiums – 9,031 licenses; Vacation rental dwellings – 17,934 licenses; and Vacation rental timeshare projects – 27 licenses. Inspections of Vacation Rentals The division must inspect each licensed public lodging establishment at least biannually, but must inspect transient and nontransient apartments at least annually. However, the division is not required to inspect vacation rentals, but vacation rentals must be available for inspection upon a request to the division.7 The division conducts inspections of vacation rentals in response to a consumer complaint.